Did Hatch divert money to allies and ACORN in 2006?

posted at 10:47 am on July 1, 2008 by Ed Morrissey

Former Attorney General Mike Hatch barely lost to Tim Pawlenty in the 2006 race for Minnesota Governor — and according to a new legislative audit, he may have abused his position to close the gap. As part of its settlement with Capital One on a deceptive-advertising complaint, Hatch arranged a payment from the credit company that came a dollar short of the requirement to put the money in the state’s general funds. What did Hatch do with the money instead? He directed it to non-profits that — surprise! — supported his gubernatorial campaign, including one organization notorious for its involvement in voter fraud:

A Minnesota government investigator has questioned whether former Attorney General Mike Hatch was out to aid a political ally in a 2006 settlement with a credit card company that steered nearly $500,000 away from the state treasury and toward nonprofit groups.

According to an inquiry by the legislative auditor made public Monday, Hatch’s office agreed to drop its deceptive-advertising case against Capital One Bank that February in exchange for $749,999 — a dollar short of a statutory threshold for automatic deposit of settlement funds into state coffers.

Instead, Hatch’s office and the defendant were able to pick other recipients for two-thirds of the proceeds: the Minnesota chapters of the Legal Aid Society and the Association of Community Organizations for Reform Now, known as ACORN. The state got $250,000 to cover its investigative costs.

Less than a month later, Hatch appeared as a gubernatorial candidate at a news conference to accept the endorsement of ACORN’s Minnesota-based political action committee, which is legally distinct from the nonprofit group’s official work.

Jim Nobles, the Legislative Auditor, demanded answers from Hatch’s successor, Lori Swanson, who worked closely with Hatch both in his capacity as AG and in the election. Swanson insists that the probe is motivated by state employees who want to organize, not exactly a demographic historically unfriendly to Democrats, in this state or any other. Nobles says that the pattern of payments and the strange settlement amount caught his notice.

Hatch insists that Capital One chose ACORN, and not him or his office. However, that doesn’t pass the smell test. Why would Capital One choose ACORN? It has nothing to do with credit services. Ah, but ACORN has plenty of involvement in Democratic politics. Even if Capital One “chose” ACORN, the selection stinks of political backscratching, a means of sucking up to a hyperpartisan AG with big ambitions.

In any event, an AG should have known that ACORN has its own legal problems. They have been accused of fraudulent activity in more than one area while driving voter-registration efforts for Democrats, and had faced legal action well before 2006. Why would the state’s top law-enforcement agent send money that he won on behalf of the state to an organization whose activities were the subject of legal probes themselves?

Nobles may not find any crimes broken in this transaction, but that doesn’t make what Hatch did right. It smells like a payoff for his own political ambitions, and it should bury any hope Hatch has of a future in Minnesota politics.

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

ACORN is based in Chicago and has provided the shock troops for all of Barack Obama’s campaign. Stanley Kurtz has written extensively on the connection in National Review.

ACORN has been shaking down financial services companies for years, so it’s plausible that Capital One did choose it in this case as a self-preservation move. It’s on every Democrat’s list of “approved non-profits” and it maintains a thinly staffed network of finncial counseling agencies to give it the veneer of legitimacy in agreements such as this one. But its real purpose is left-wing, Alinsky-style organizing in low-income communities.

Gov. Pawlenty recently vetoed an ACORN-sponsored bill that would have imposed a two-year moratorium on foreclosures in Minnesota, and pretty much guaranteed that no mortgage lenders would do any more business in the state. AG Lori Swanson enthusiastically endorsed this bill. A foreclosure moratorium would mean that lenders holding mortgages in default would be forced to negotiate with borrowers to modify the loans, and ACORN “counselors” would have been right in the middle of these negotiations. No doubt they would have shaken down every mortgage lender in the country for even more money in return for their “cooperation.”

ACORN is promoting similar moratorium bills around the country. They barely failed in New York last week, but the bill that passed is still very onerous for lenders.

As I’ve mention in other posts. I had a personal encounter with ACORN during the 2004 elections when I was an election judge supervisor. The are aggressive at fraudulent registering of voters and will stop at nothing to intimidate and push you around. I’m 6’2″ and 235…. it didn’t happen. The point is, they are avowed Marxists and Hatch kissed their asses big time.

ACORN is all over the place down here in the lower 9th ward of New Orleans. They are a vile, corrupt, racist group who never saw a successful white person who “deserved it” and never saw a poor ethnic person they don’t claim is being oppressed by the system.

It smells like a payoff for his own political ambitions, and it should bury any hope Hatch has of a future in Minnesota politics.

Should or will? Down here in NOLA, William Jefferson SHOULD be out of office and spending his time talking to his lawyers. He will be re-elected to Congress for the second time since the Feds nabbed him with 90K in his freezer.